Douglas Wood, a 64-year-old engineer who is a longtime resident of Alamo, Calif., said he was "extremely happy and relieved to be free again," according to a message read by Australia's counterterrorism chief Nick Warner.
The raid took place as part of Operation Lightning — a broader counterinsurgency operation that began in Baghdad on May 29, Warner said. He added there "was specific intelligence and tips that provided a hint at what might be found at that location."
In Khalis, about 45 miles north of Baghdad, the suicide bomber walked into the crowded mess hall wearing an army uniform and waiting until soldiers had gathered for lunch before blowing himself up, Iraqi army Col. Saleh al-Obeidi said.
The soldiers belonged to the Al-Salam battalion of the 2nd brigade of the Iraqi army in Diyala province.
The injured were being evacuated to a nearby hospital, Iraqi army Maj. Abbas Timimi said.
In other developments:
Although there was no immediate claim of responsibility for the Khalis attack, it bore the hallmarks of Iraq's radical extremist groups — which regularly use suicide attackers.
In one such attack Tuesday in northern Kirkuk, a man wearing a similar belt loaded with explosives killed 23 people and wounded nearly 100 after striking outside a bank as retirees waited to cash their pension checks.
Al Qaeda's northern affiliate, the Ansar al-Sunnah Army, claimed responsibility and threatened more violence in retaliation for the arrests and killings of Sunni Arabs.
Wood was freed by the Iraqi army's 2nd battalion, 1st Armored Brigade, with assistance by U.S. forces in Ghazaliya — one of the most dangerous Sunni Arab neighborhood of Baghdad, Warner said. He added that "no ransom was paid" despite a request for a "very large" amount of money.
Wood was found under a blanket and the insurgents told troops he was their sick father, said Gen. Naseer al-Abadi, Iraq's deputy chief of staff. The operation also resulted in the arrest of three insurgents and release of an Iraqi hostage.
"This is a great day for Iraq. We are proud of the way our soldiers conducted themselves," al-Abadi said.
Wood was abducted in late April by a militant group calling itself the Shura Council of the Mujahedeen of Iraq.
The Australian government refused to bend to the kidnappers' demands that its 1,400 troops be withdrawn from Iraq. It sent diplomats, police and military personnel to Baghdad to seek his release.
"I am delighted to inform the House that the Australian hostage in Iraq, Mr. Douglas Wood, is safe," Prime Minister John Howard told Parliament in Canberra, Australia.
Howard told reporters an Iraqi military unit, in cooperation with U.S. forces, rescued Wood.